I decided to continue showing interesting examples and trading techniques using my trading products. And also with the use of other tools. I hope you find it interesting and useful. So let’s go.
The article will be supplemented with examples during the current month.
AOTI: GBPUSD Sideways Movement (M5 Timeframe)
The price wants to go up, but there is a strong resistance at the way (equal with the Min TP level).
We did not go to our target (Today TP) but froze at the Min TP level. Why? It’s simple – the price did not have enough power to overcome the strong resistance level that was on its way.
Let’s take a look at the higher timeframe H4:
In this situation, it would be better to take the minimum profit at the Min TP level, or move the position to breakeven, if we have a reserve of movement in pips to withstand a possible pullback.
AOTI: EURJPY – Intermediate Profit and Re-Enter the Market
As you know, the price rarely goes in a straight line from point A to point B. Although you must agree, it would be good if this were the case.
So, much more often the price goes to the target making spikes, false breakouts, pullbacks in the opposite direction, deceleration of movement (flat area), etc.
Let’s look at the example of the EURJPY currency pair, how we can take an intermediate profit, or a part of the profit, and then enter the market again.
We see a support micro-level in the path of our downtrend. This means weakening price pressure and a possible price pullback. In this case, we can take the profit that is at the moment, if we do not want to risk, or we can move our position to breakeven.
But suppose that, as a result of our actions, we find ourselves out of the market. What should we do next? Let’s remember our micro-level and the fact that we are waiting for a price at the Today TP level. Knowing all of this, we may set a pending breakout order (Sell Stop) slightly below the support micro-level to avoid false triggering.
Thus, when the price turns in our direction, we find ourselves in the market again and reach the winning goal – Today TP.
AOTI: EURUSD and USDCHF – Achieving Target Level at the Same Time or Not
As I wrote earlier, the Market does not even try to simplify our life, but on the contrary, shows us in every possible way who is boss here. But don’t be afraid, it’s not your job to beat the Market. You just have to learn to follow his prompts and get your profit.
I am often asked what to do if one of the correlated pairs has already reached the target level, and the other has not.
For example, USDCHF has already reached the target level (Today TP):
But at the same time, the EURUSD currency pair is still far enough from the target level:
In this case, when we take profit on one of the currency pairs (USDCHF), I would recommend taking profit on the other (EURUSD in our case), although the target level has not yet been reached there. Or, move the position to breakeven and watch where the price will go next, preparing to close the position in the event of a reversal movement.
AOTI: How Can Candles (Bars) with Larger Bodies Help Us Avoid Losses?
Now I want to tell you another secret that I use in trading. This is a certain pattern that I have defined for myself.
I’m talking about candlesticks (bars) whose bodies are much larger than the bodies of nearby candlesticks. And if those bodies are larger than the candle bodies (bars) on an even larger section of history, that signal is even stronger.
What do I do in such cases? How can this be used if we are in the market and our position is open to Sell on the indicator signal?
The appearance of such a candle can be followed by either a continuation of the trend or a reversal. The middle of such candles is a good opportunity to move the stops of the Sell positions (as in our example) to the profit side (marked with red thick lines).
You may ask, but what advantages does this give us? It’s simple.
1) If price moves in our direction (Selling in our example), we will then successfully move our stops in the direction of the profit. This is something like Profit Trailing.
2) If the price reverses quickly (as in our example), we will make a profit (or at least breakeven) rather than a loss.
I think someday I will implement such a profit trailing in a future version of AOTI-EA-Assistant.
AOTI: Another Weakened Trend on EURUSD
Trading session activity has faded and the Today TP target has not yet been reached. And resistance levels built by the AOTI indicator began to appear in the price’s way.
What we can do:
Take a profit at the Min TP level
Move the position to breakeven level and waiting to see where the price goes next. In this case, it is advisable to move the stop level following the price, so as not to lose a significant part of the profit, in case of the price reversal.